Tax Coalition Wakes Up

Revived Business Group Vows to Fight ‘Mother of All Tax Bills’

Posted October 30, 2007 at 6:13pm

On Tuesday, as many as 70 business lobbyists and two top House Republican leaders will file into a room at 400 N. Capitol St. NW to plot out their strategy to fight Democrats’ tax proposals.

It is the first Member-lobbyist meeting of the Tax Relief Coalition’s steering committee since 2003, when the group was focused on pushing for the tax cuts proposed by President Bush. After 2003, the coalition became dormant.

The new Tax Relief Coalition has shifted its focus from the administration to Congress, and has gone from playing offense to defense — primarily against a “mother of all tax bills” drafted by Ways and Means Chairman Charlie Rangel (D-N.Y.).

Gone is Karl Rove, the former top White House aide who helped spearhead the coalition. Now, House Minority Leader John Boehner (R-Ohio) and Chief Deputy Minority Whip Eric Cantor (R-Va.) will play crucial roles helping gin up support for the coalition.

“My intention is to issue a call to arms,” said Cantor of the upcoming meeting. “We really really need an organized front in opposition in the part of the business community in this country. I’m going to make the case, we’ve got to stick together on this. We need an organized front.”

Cantor called the Rangel proposal a job killer and said he wants to make sure Tax Relief Coalition members “understand how seriously we are taking this assault on entrepreneurialism, investment and job creation.”

Boehner spokesman Brian Kennedy confirmed that his boss will attend the meeting and that Boehner plans to address the group. “We’ve been encouraging anyone who works for or owns a business, large or small, to get active, to work against the Democrats’ tax hikes,” he said. “This coalition in particular has a proven track record and was critical in helping us pass tax relief in 2001 and 2003, and they’ll be just as critical in helping us stop the Democrats from passing the largest tax increase in American history.”

Jade West, senior vice president at the National Association of Wholesaler-Distributors, said the membership of the long-dormant coalition is likely to remain the same as the last go-around. The NAWD runs the effort.

“It is a very different political world today,” West said. “We are not now looking at a business-friendly or economy-friendly tax cut. We’re looking at a business-unfriendly and economically damaging tax hike.”

The new Tax Relief Coalition, West said, is growing. “Fear does that to you,” she said.

The coalition has about 1,000 public members, groups or companies that go on record supporting the coalition but do not pay dues and have less decision-making authority.

Another 70 or so members — including the U.S. Chamber of Commerce, National Association of Manufacturers, National Federation of Independent Business and the National Restaurant Association — pay $5,000 a year and belong to the steering committee.

The Tax Relief Coalition is just now in the process of assessing dues for the first time since 2003, and some of that money will go to a revamped Web site that is expected to launch in the coming weeks.

In its previous iteration, the coalition was loyal to the Bush administration’s plan, even to the exclusion of policies backed by other business groups. That hard-line approach led to a rift between the coalition and some of its tech-company members, who went outside the TRC to push for tax write-offs for capital equipment purchases.

Although some insiders say this time the business community is vulnerable to even more internal rifts, West — like Cantor — is talking unity.

“The more united the business community is, the stronger we are,” she said. “There’s nothing in TRC membership that says you’re not allowed to want other things. I think the most important thing we can do is hold the business community together. If we in the business community start a feeding frenzy on ‘how much can I get,’ we will end up with a bill that will be extremely damaging to the economy as a whole.”

Bruce Josten, the top lobbyist for the U.S. Chamber of Commerce, said members of the TRC already are united by a fear of the Bush tax cuts that are set to expire in 2010.

“There’s a trillion-dollar-plus tax increase, separate from Rangel and the mother,” he said. Josten said he expects some companies in every association’s membership to cut ranks and try to work out deals or support Democratic tax proposals that might benefit them individually.

But, he said, overall the group has a lot to agree on. Last week, he said, the group’s membership came together to raise the alert against the Rangel plan.

Dan Danner, the policy and lobbying chief for the National Federation of Independent Business, said this time around he sees more similarities than differences in the coalition. “I think the meeting will show that the business community still pretty much shares concerns across the whole business community,” he said.

At the National Restaurant Association, John Gay, the senior vice president of government affairs and public policy, said restaurants have a stake in the tax debate on multiple fronts and will be working the reactivated coalition to push its agenda.

“The more disposable income that people have, the more likely they are to go to restaurants,” he said.

When it comes to business taxes, Gay said it’s complicated for his group and he isn’t certain what position his members will want to take. “It’s a little murkier,” he said. “I think everyone is still together on the mission of the ’01 and ’03 tax cuts. I think where it gets fuzzier is where it gets beyond that. I don’t know how that’s going to play out.”